IDEAS home Printed from https://ideas.repec.org/p/ehl/lserod/118296.html
   My bibliography  Save this paper

East Asia and the politics of global finance: a developmental challenge to the neoliberal consensus?

Author

Listed:
  • Pape, Fabian
  • Petry, Johannes

Abstract

Recent IPE scholarship locates the key dynamics of financial globalization in two areas: public money flows between the US and Asia, or private banking flows between the US and Europe. This dichotomy presents the globalization of private finance as firmly anchored within transatlantic, neoliberal financial norms. We argue that this creates a blind spot regarding the growing role of East Asian finance within the global financial system. Combining CPE insights on institutional characteristics of Asian financial systems with a macro-financial analysis of the global financial system, this paper analyzes the global implications of the geographic shift towards East Asia. First, we demonstrate the growing importance of East Asia for global macro-financial flows, actors and markets that goes beyond the rise of China. Second, we explore how the institutional arrangements that underpin Asian financial systems differ significantly from transatlantic finance. By investigating the growing importance of global investors in Asian markets and Asian investors in global markets, we explore how the shift towards East Asia introduces a growing role of developmental characteristics within global finance. This calls for a reconsideration of conventional analyses of the global financial system which often assume its role as a force of neoliberal globalization.

Suggested Citation

  • Pape, Fabian & Petry, Johannes, 2023. "East Asia and the politics of global finance: a developmental challenge to the neoliberal consensus?," LSE Research Online Documents on Economics 118296, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:118296
    as

    Download full text from publisher

    File URL: http://eprints.lse.ac.uk/118296/
    File Function: Open access version.
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Fabian Pape, 2022. "Governing Global Liquidity: Federal Reserve Swap Lines and the International Dimension of US Monetary Policy," New Political Economy, Taylor & Francis Journals, vol. 27(3), pages 455-472, May.
    2. Helleiner, Eric, 2014. "The Status Quo Crisis: Global Financial Governance After the 2008 Meltdown," OUP Catalogue, Oxford University Press, number 9780199973637.
    3. Daniela Gabor, 2021. "The Wall Street Consensus," Development and Change, International Institute of Social Studies, vol. 52(3), pages 429-459, May.
    4. Fratzscher, Marcel, 2012. "Capital flows, push versus pull factors and the global financial crisis," Journal of International Economics, Elsevier, vol. 88(2), pages 341-356.
    5. Iain Hardie & Helen Thompson, 2021. "Taking Europe seriously: European financialization and US monetary power," Review of International Political Economy, Taylor & Francis Journals, vol. 28(4), pages 775-793, July.
    6. Maurice Obstfeld & Kenneth S. Rogoff, 2009. "Global imbalances and the financial crisis: products of common causes," Proceedings, Federal Reserve Bank of San Francisco, pages 131-172.
    7. Baines, Joseph & Hager, Sandy Brian, 2022. "From Passive Owners to Planet Savers? Asset Managers, Carbon Majors and the Limits of Sustainable Finance," EconStor Preprints 249674, ZBW - Leibniz Information Centre for Economics.
    8. Rogoff, Kenneth & Obstfeld, Maurice, 2009. "Global Imbalances and the Financial Crisis: Products of Common Causes," CEPR Discussion Papers 7606, C.E.P.R. Discussion Papers.
    9. Daniela Gabor, 2016. "The (impossible) repo trinity: the political economy of repo markets," Review of International Political Economy, Taylor & Francis Journals, vol. 23(6), pages 967-1000, November.
    10. Elizabeth Thurbon, 2020. "The Future of Financial Activism in Taiwan? The Utility of a Mindset-centred Analysis of Developmental States and Their Evolution," New Political Economy, Taylor & Francis Journals, vol. 25(3), pages 320-336, April.
    11. Robert H. Wade, 2018. "The Developmental State: Dead or Alive?," Development and Change, International Institute of Social Studies, vol. 49(2), pages 518-546, March.
    12. Imogen T. Liu & Adam D. Dixon, 2021. "Legitimating State Capital: The Global Financial Professions and the Transnationalization of Chinese Sovereign Wealth," Development and Change, International Institute of Social Studies, vol. 52(5), pages 1251-1273, September.
    13. Wade, Robert H., 2018. "The developmental state: dead or alive?," LSE Research Online Documents on Economics 87356, London School of Economics and Political Science, LSE Library.
    14. Mareike Beck, 2022. "Extroverted financialization: how US finance shapes European banking," Review of International Political Economy, Taylor & Francis Journals, vol. 29(5), pages 1723-1745, September.
    15. Lena Rethel & Elizabeth Thurbon, 2020. "Introduction: Finance, Development and the State in East Asia," New Political Economy, Taylor & Francis Journals, vol. 25(3), pages 315-319, April.
    16. Prasad, Monica, 2006. "The Politics of Free Markets," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226679013.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:osf:socarx:asx7t_v1 is not listed on IDEAS
    2. Daniela Gabor & Ndongo Samba Sylla, 2023. "Derisking Developmentalism: A Tale of Green Hydrogen," Development and Change, International Institute of Social Studies, vol. 54(5), pages 1169-1196, September.
    3. Fichtner, Jan & Petry, Johannes, 2024. "Global Finance: changing practices, actors, and geographies," SocArXiv asx7t, Center for Open Science.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gabor, Daniela, 2023. "The (European) Derisking State," SocArXiv hpbj2, Center for Open Science.
    2. Gabor, Daniela, 2020. "The Wall Street Consensus," SocArXiv wab8m, Center for Open Science.
    3. Mark Copelovitch & David A. Singer, 2017. "Tipping the (Im)balance: Capital inflows, financial market structure, and banking crises," Economics and Politics, Wiley Blackwell, vol. 29(3), pages 179-208, November.
    4. Joscha Beckmann & Robert L. Czudaj, 2020. "Net Foreign Asset Positions, Capital Flows and GDP Spillovers," Open Economies Review, Springer, vol. 31(2), pages 295-308, April.
    5. Isaac Khambule, 2021. "Capturing South Africa's developmental state: State‐society relations and responses to state capture," Public Administration & Development, Blackwell Publishing, vol. 41(4), pages 169-179, October.
    6. Yannis Dafermos & Daniela Gabor & Jo Michell, 2023. "FX swaps, shadow banks and the global dollar footprint," Environment and Planning A, , vol. 55(4), pages 949-968, June.
    7. Douglas Sutherland & Peter Hoeller & Balázs Égert & Oliver Röhn, 2010. "Counter-cyclical Economic Policy," OECD Economics Department Working Papers 760, OECD Publishing.
    8. Daisuke Ikeda & Toan Phan & Timothy Sablik, 2020. "Asset Bubbles and Global Imbalances," Richmond Fed Economic Brief, Federal Reserve Bank of Richmond, vol. 20, pages 1-4, January.
    9. Mika Nieminen, 2017. "Patterns of international capital flows and their implications for developing countries," WIDER Working Paper Series wp-2017-171, World Institute for Development Economic Research (UNU-WIDER).
    10. Stijn Claessens & M. Ayhan Kose, 2013. "Financial Crises: Explanations, Types and Implications," CAMA Working Papers 2013-06, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    11. Thomas Fischer, 2012. "Inequality and Financial Markets - A Simulation Approach in a Heterogeneous Agent Model," Lecture Notes in Economics and Mathematical Systems, in: Andrea Teglio & Simone Alfarano & Eva Camacho-Cuena & Miguel Ginés-Vilar (ed.), Managing Market Complexity, edition 127, chapter 0, pages 79-90, Springer.
    12. Zsofia Barany & Nicolas Coeurdacier & Stéphane Guibaud, 2015. "Fertility, Longevity and International Capital Flows," Working Papers hal-01164462, HAL.
    13. Sokolova, Maria V., 2016. "Exchange Rates, International Trade and Growth: Re-Evaluation of Undervaluation," Conference papers 332790, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    14. Dong, Wei, 2012. "The role of expenditure switching in the global imbalance adjustment," Journal of International Economics, Elsevier, vol. 86(2), pages 237-251.
    15. Can Xu & Jan P. A. M. Jacobs & Jakob de Haan, 2023. "Does Household Borrowing Reduce the Trade Balance? Evidence from Developing and Developed Countries," Open Economies Review, Springer, vol. 34(4), pages 759-787, September.
    16. Joscha Beckmann & Robert Czudaj, 2017. "Effective Exchange Rates, Current Accounts and Global Imbalances," Review of International Economics, Wiley Blackwell, vol. 25(3), pages 500-533, August.
    17. Christophe André, 2016. "Household debt in OECD countries: stylised facts and policy issues," Chapters from NBP Conference Publications, in: Hanna Augustyniak & Jacek Łaszek & Krzysztof Olszewski & Joanna Waszczuk (ed.), Papers presented during the Narodowy Bank Polski Workshop: Recent trends in the real estate market and its analysis - 2015 edition, chapter 2, pages v1, 33-85, Narodowy Bank Polski.
    18. Catte, Pietro & Cova, Pietro & Pagano, Patrizio & Visco, Ignazio, 2011. "The role of macroeconomic policies in the global crisis," Journal of Policy Modeling, Elsevier, vol. 33(6), pages 787-803.
    19. Dimitar Anguelov, 2024. "State‐owned Enterprises and the Politics of Financializing Infrastructure Development in Indonesia: De‐risking at the Limit?," Development and Change, International Institute of Social Studies, vol. 55(3), pages 493-529, May.
    20. Anna Wong, 2017. "China’s Current Account : External Rebalancing or Capital Flight?," International Finance Discussion Papers 1208, Board of Governors of the Federal Reserve System (U.S.).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • F3 - International Economics - - International Finance
    • G3 - Financial Economics - - Corporate Finance and Governance
    • J1 - Labor and Demographic Economics - - Demographic Economics

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ehl:lserod:118296. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: LSERO Manager (email available below). General contact details of provider: https://edirc.repec.org/data/lsepsuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.